Mining difficulty rules suggest Bitcoin will reach $31,000 in 2021

According to the latest data on Bitcoin mining difficulty, the price of Bitcoin may exceed $30,000 in 2021.

Well-known crypto analyst PlanB shared statistics on Bitcoin mining difficulty on Twitter. He analyzed the relationship between the percentage increase in Bitcoin price from the low point of mining difficulty and the number of blocks.

Mining difficulty is the difficulty for crypto miners to calculate the correct hash value. It can measure the degree of competition among Bitcoin miners to mine blocks, because the more intense the competition, the greater the mining difficulty.

PlanB said that Bitcoin has experienced several difficulty cycles in history, and in each cycle the price of Bitcoin will rise by an order of magnitude relative to the previous difficulty low.

As you can see in the chart, at the end of 2013, the price of Bitcoin was as high as $1,300, which was a 50,000% increase from the previous difficulty low. At the end of 2017, the price of Bitcoin was $20,000, which was a 9,000% increase from the previous difficulty low.

According to this model, Bitcoin is currently entering a new mining difficulty cycle. If it can replicate the pattern of price increases in previous difficulty cycles, it will rise by 1,000% in 2021, that is, to $31,000. Because when Bitcoin mining difficulty was at its low point in December 2018, its trading price was $3,100.

According to Bitpush data, the price of Bitcoin has continued to fluctuate around $10,000 over the past month. Although there are positive news in the crypto industry, such as Bakkt's upcoming launch of Bitcoin futures, the intensification of the Sino-US trade war, the possibility of a global economic recession, and the possibility of a no-deal Brexit, investors are still waiting and watching.

Image source: Twitter, Pixabay

AuthorXiu MU